High Number of Phone Books Irking Lawmakers

As the number of phone books published annually in the United States has outnumbered the population two to one, some lawmakers are not happy.

 

A frequent target in state legislatures, they have tried – so far unsuccessfully – to place limits on the distribution of phone books. The $17 billion-a-year industry is showing remarkable resilience as other advertising-driven businesses suffer.

 

The Yellow Pages Association, an industry trade group, calls 2008 the “most challenging year to date” with regard to efforts to restrict directory publishers’ ability to freely deliver phone books. Recent legislation that would empower residents to opt out of receiving phone books has failed or stalled in at least seven states.

 

The association has paid outside lobbyists about $50,000 so far this year to defend it in communities across the nation. Two main points they are trying to make are that phone books help promote local businesses and are made almost entirely from wood scraps and recycled paper.

 

Albany City Councilman Joseph Igoe is trying to pass a law that would limit the distribution of phone books after campaigning door-to-door last year and seeing phone books wrapped in plastic littering sidewalks, driveways and lawns. Proposals have also been floated, without success, by legislatures in Alaska, Hawaii, Minnesota, New Mexico, New York, North Carolina and Washington.

 

Some residents in Seattle receive phone books from as many as four different publishers, according to Tom Watson, a waste prevention specialist for the region. Phone book publishers acknowledge that many people receive more phone directories than needed, but call it a sign of competition and argue that the marketplace, not the government, should determine the number of books distributed.

 

“The ones that get used will remain, and the ones that don’t will go away,” said Joe Walsh (News - Alert), president and CEO of YellowBook USA Inc., the nation’s largest independent yellow pages publisher with a circulation of about 128 million phone books in 48 states.

 

For years, phone companies dominated the directory business and published the only phone book available in many markets. Federal rules enacted in the late 1990s required them to provide listings to independent publishers at a reasonable cost and ignited an explosion of competition.

“Because there’s money in those yellow pages,” said David Goddard, senior analyst of the Yellow-Pages group for Simba Information, a Stamford, Conn.-based media research company.

 

Last year, Yellow Pages publishers logged roughly $16.8 billion in revenue. That figure is on pace to rise to $17.2 billion this year, and $17.6 billion in 2009, according to Simba’s projections.

 

YellowBook logged $406.1 million in revenue during the three months that ended in June, up 9.3 percent from the same period last year. During the same period, Idearc, Verizon’s (News - Alert) former yellow pages business which it spun off in 2006, reported revenue that fell 5.1 percent to $1.5 billion.

While other advertising-driven businesses – particularly newspapers and magazines – have been struggling as their readers and advertisers migrate to the Internet, the old-fashioned printed copy remains key in the Yellow-Pages business.

A usage study conducted by statistical research firm Knowledge Networks/SRI estimates that Americans referred to print Yellow Pages advertisements 13.4 billion times last year, compared with 3.8 billion online listings.

“They really have to focus on print,” Goddard said, noting that online ads make up less than 9 percent of yellow pages’ revenue. “The Internet is the sexy new technology out there, but it isn’t where most of their money is coming from. It’s coming from the mom-and-pop stores that want to be in that Yellow Pages book.”

Yellow Pages Association spokeswoman, Stephanie Hobbs, said most of the country’s 200-plus Yellow Pages publishers allow people to opt out from receiving the books and provide recycling when they become outdated. Skeptics say phone book publishers don’t always make it easy to opt out and the cost of blanketing neighborhoods with books they know will be discarded is cheaper than targeting distribution.

Eve Sullivan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Eve's articles, please visit her columnist page.